Background

A 50 per cent shareholder in a successful business operating within the transport and logistics sector was considering a claim for unfair prejudice, including misappropriation of company funds, following a deterioration in the long-standing relationship between the two equal shareholders. Our client had limited historical financial information.

Action

FRP’s Forensic Services Partner, Fiona Hotston Moore, was appointed as an expert witness to review the financial information available, provide independent expert evidence on the valuation of the 50 per cent shareholding, and to review the sums drawn by each shareholder as fees, dividends and expenses. Our Forensic Services team considered the key legal contracts and industry data relevant to the sector, before approaching the valuation, adopting both an earnings methodology and a discounted cashflow.

Outcome

The Forensic Services team produced the business valuation and quantification of the potential monies misappropriated as an expert opinion within three weeks. The client and counsel were delighted with the report, which enabled a robust loss claim to be prepared.